What tech should financial planners be using?

20 March 2019

There can surely be little doubt that the role of technology in financial advice can be bewildering to the average person. Is it execution-only or advised? Robo or hybrid? Guidance or advice?

Do most people even know what those terms mean? Probably not.

Even the regulator is apparently having difficulty getting to grips with what services various software and websites offer, to whom and for what.

As Clive Waller observed in a recent tweet: “Dear FCA, Transact is a platform service; SJP is a wealth manager; HL is an investment broker and an adviser. They are not the same.”

Yet, with the explosion of financial advice tools, even advisers – yes, you the professionals! – are in danger of being bogged down by the ever-increasing options.

Therefore, what chance does members of the public have?

So let’s at least get our own house in order and sort this out.

‘AdviceTech’ – what’s available and what does it do?

‘AdviceTech’ tools will generally perform some useful function in some part of the coaching, planning, advice continuum.

That is to say, to a greater or lesser degree, the tech will support you in taking on clients, helping them imagine their futures, teasing out their needs along that journey and finding the solutions that match their goals at various points along the way.

Most will take care of some compliance headache or other as part of – or all of – the service.

To be fair to the FCA, though it often comes under fire for failing to keep up with technology, it has produced a helpful list arranged by popularity among advisers in its Investment Platforms Market Study.

In the ‘majority’ usage camp were – and there’s no surprise here – tools provided for free by most platforms. These included technology for charge collection, reporting and management information, pre-funding and Capital Gains Tax calculators.

Then came the tools used by ‘many’. These were training tools, model portfolio management tech, software for bulk rebalancing and switching and white-labelling services that allow advisers to skin their preferred platform in their own company’s visual brand.

Finally, there were the ‘minority’ tools. These included asset allocation programmes, risk profiling and fund risk profiling tech, cashflow modelling software and tools for research and best-buy lists.

Clearly you won’t need all of these and as Abraham Okusanya noted in his excellent article, this list is useful in assessing whether the availability of tools creates a bias in the adviser’s product/platform selection process in a way that could be detrimental to the client?

Perhaps a better way of thinking about these tools is by grouping them in the categories used by the wrap platform, Nucleus in its 2018 Census.

These are categories are: data management/back office, risk profiling, cashflow modelling, fund research and platform comparison…with wrap platforms themselves kept out of the survey, for obvious reasons.

What does Advicefront do?

It would be neglectful, at this point, not to tell you that we offer a single suite of fact-finding, risk-profiling, client agreement, billing and digital signature tools in our product, Onboard. The idea is to help financial planners automate tasks that are boring and add little value so they can concentrate on nurturing relationships with clients.

And the best part is we integrate with the many of tools you all already use for risk–profiling, cashflow-modelling and more. So you won’t have to stop using them if you don’t want to.

Please click here to request your free Demo!

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Article written with the brilliant help of our dear friends at Foco.

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Author
Andre Costa

CTO & Co-Founder of Advicefront and also the Lead Frontend Teacher @lewagonlisbon

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